微观经济学课件：Supply, Demand, and Government Policies

1、 2007 Thomson South-Western 2007 Thomson South-WesternSupply, Demand, and Government Policies In a free, unregulated market system, market forces establish equilibrium prices and exchange quantities. While equilibrium conditions may be efficient, it may be true that not everyone is satisfied. One of

2、 the roles of economists is to use their theories to assist in the development of policies. 2007 Thomson South-WesternCONTROLS ON PRICES Are usually enacted when policymakers believe the market price is unfair to buyers or sellers. Result in government-created price ceilings and floors. 2007 Thomson

3、 South-WesternCONTROLS ON PRICES Price Ceiling A legal maximum on the price at which a good can be sold. Price Floor A legal minimum on the price at which a good can be sold. 2007 Thomson South-WesternHow Price Ceilings Affect Market Outcomes Two outcomes are possible when the government imposes a p

4、rice ceiling: The price ceiling is not binding if set above the equilibrium price. The price ceiling is binding if set below the equilibrium price, leading to a shortage. 2007 Thomson South-WesternFigure 1 A Market with a Price Ceiling(a) A Price Ceiling That Is Not BindingQuantity ofIce-CreamCones0

5、Price ofIce-CreamConeEquilibriumquantity$4PriceceilingEquilibriumpriceDemandSupply3100The market clears at $3 and the price ceiling is ineffective. 2007 Thomson South-WesternFigure 1 A Market with a Price Ceiling(b) A Price Ceiling That Is BindingQuantity ofIce-CreamCones0Price ofIce-CreamConeDemand

6、Supply2PriceceilingShortage75Quantitysupplied125QuantitydemandedEquilibriumprice$3 2007 Thomson South-WesternHow Price Ceilings Affect Market Outcomes Effects of Price Ceilings A binding price ceiling creates Shortages because QD QS. Example: Gasoline shortage of the 1970s Nonprice rationing Example

7、s: Long lines; discrimination by sellers 2007 Thomson South-WesternCASE STUDY: Lines at the Gas Pump Economists blame government regulations that limited the price oil companies could charge for gasoline. In 1973, OPEC raised the price of crude oil in world markets. Crude oil is the major input in g

8、asoline, so the higher oil prices reduced the supply of gasoline. What was responsible for the long gas lines? 2007 Thomson South-WesternFigure 2 The Market for Gasoline with a Price Ceiling(a) The Price Ceiling on Gasoline Is Not BindingQuantity ofGasoline0Price ofGasoline1. Initially,the priceceil

9、ingis notbinding . . .Price ceilingDemandSupply, S1P1Q1 2007 Thomson South-WesternFigure 2 The Market for Gasoline with a Price Ceiling(b) The Price Ceiling on Gasoline Is BindingQuantity ofGasoline0Price ofGasolineDemandS1S2Price ceilingQS4. . . . resultingin ashortage.3. . . . the priceceiling bec

10、omesbinding . . .2. . . . but whensupply falls . . .P2QDP1Q1 2007 Thomson South-WesternCASE STUDY: Rent Control in the Short Run and Long Run Rent controls are ceilings placed on the rents that landlords may charge their tenants. The goal of rent control policy is to help the poor by making housing

11、more affordable. One economist called rent control “the best way to destroy a city, other than bombing.” 2007 Thomson South-WesternFigure 3 Rent Control in the Short Run and in the Long Run(a) Rent Control in the Short Run(supply and demand are inelastic)Quantity ofApartments0SupplyControlled rentRe

12、ntalPrice ofApartmentDemandShortage 2007 Thomson South-WesternFigure 3 Rent Control in the Short Run and in the Long Run(b) Rent Control in the Long Run(supply and demand are elastic)0RentalPrice ofApartmentQuantity ofApartmentsDemandSupplyControlled rentShortage 2007 Thomson South-WesternHow Price

13、Floors Affect Market Outcomes When the government imposes a price floor, two outcomes are possible. The price floor is not binding if set below the equilibrium price. The price floor is binding if set above the equilibrium price, leading to a surplus. 2007 Thomson South-WesternFigure 4 A Market with

14、 a Price Floor(a) A Price Floor That Is Not BindingQuantity ofIce-CreamCones0Price ofIce-CreamConeEquilibriumquantity2PricefloorEquilibriumpriceDemandSupply$3100The government says that ice-cream cones must sell for at least $2; this legislation is ineffective at the current market price. 2007 Thoms

15、on South-WesternFigure 4 A Market with a Price Floor(b) A Price Floor That Is BindingQuantity ofIce-CreamCones0Price ofIce-CreamConeDemandSupply$4Pricefloor80Quantitydemanded120QuantitysuppliedEquilibriumpriceSurplus3 2007 Thomson South-WesternHow Price Floors Affect Market Outcomes A price floor pr

16、events supply and demand from moving toward the equilibrium price and quantity. When the market price hits the floor, it can fall no further, and the market price equals the floor price. 2007 Thomson South-WesternHow Price Floors Affect Market Outcomes A binding price floor causes . . . a surplus be

17、cause QS QD. nonprice rationing is an alternative mechanism for rationing the good, using discrimination criteria. Examples: The minimum wage; agricultural price supports 2007 Thomson South-WesternCASE STUDY: The Minimum Wage An important example of a price floor is the minimum wage. Minimum wage la

18、ws dictate the lowest price possible for labor that any employer may pay. 2007 Thomson South-WesternFigure 5 How the Minimum Wage Affects the Labor MarketQuantity ofLaborWage0LabordemandLaborSupplyEquilibriumemploymentEquilibriumwage 2007 Thomson South-WesternFigure 5 How the Minimum Wage Affects th

19、e Labor MarketQuantity ofLaborWage0LaborSupplyLabor surplus(unemployment)LabordemandMinimumwageQuantitydemandedQuantitysupplied 2007 Thomson South-WesternTAXES Governments levy taxes to raise revenue for public projects. 2007 Thomson South-WesternHow Taxes on Buyers (and Sellers) Affect Market Outco

20、mes Taxes discourage market activity. When a good is taxed, the quantity sold is smaller. Buyers and sellers share the tax burden. 2007 Thomson South-WesternHow Taxes on Buyers Affect Market Outcomes Elasticity and tax incidence Tax incidence （税收归宿）is the manner in which the burden of a tax is share

21、d among participants in a market. 2007 Thomson South-WesternHow Taxes on Buyers Affect Market Outcomes Elasticity and Tax Incidence Tax incidence is the study of who bears the burden of a tax. Taxes result in a change in market equilibrium. Buyers pay more and sellers receive less, regardless of who

22、m the tax is levied on. 2007 Thomson South-WesternFigure 6 A Tax on BuyersQuantity ofIce-Cream Cones0Price ofIce-CreamConePricewithouttaxPricesellersreceiveEquilibrium without taxTax ($0.50)PricebuyerspayD1D2Supply, S1A tax on buyersshifts the demandcurve downwardby the size ofthe tax ($0.50).$3.309

23、0Equilibriumwith tax2.803.00100 2007 Thomson South-WesternFigure 7 A Tax on Sellers2.80Quantity ofIce-Cream Cones0Price ofIce-CreamConePricewithouttaxPricesellersreceiveEquilibriumwith taxEquilibrium without taxTax ($0.50)PricebuyerspayS1S2Demand, D1A tax on sellersshifts the supplycurve upwardby th

24、e amount ofthe tax ($0.50).3.00100$3.3090 2007 Thomson South-WesternElasticity and Tax Incidence What was the impact of tax? Taxes discourage market activity. When a good is taxed, the quantity sold is smaller. Buyers and sellers share the tax burden. 2007 Thomson South-WesternFigure 8 A Payroll Tax

25、Quantityof Labor0Wage Labor demandLabor supplyTax wedgeWage workersreceiveWage firms payWage without tax 2007 Thomson South-WesternElasticity and Tax Incidence In what proportions is the burden of the tax divided? The answers to these questions depend on the elasticity of demand and the elasticity o

26、f supply. 2007 Thomson South-WesternFigure 9 How the Burden of a Tax Is DividedQuantity0PriceDemandSupplyTaxPrice sellersreceivePrice buyers pay(a) Elastic Supply, Inelastic Demand2. . . . theincidence of thetax falls moreheavily onconsumers . . .1. When supply is more elasticthan demand . . .Price

27、without tax3. . . . than on producers. 2007 Thomson South-WesternFigure 9 How the Burden of a Tax Is DividedQuantity0PriceDemandSupplyTaxPrice sellersreceivePrice buyers pay(b) Inelastic Supply, Elastic Demand3. . . . than onconsumers.1. When demand is more elasticthan supply . . .Price without tax2. . . . theincidence of the tax falls more heavily on producers . . . 2007 Thomson South-WesternElasticity and Tax Incidence So, how is the burden of the tax divided?The burden of a tax falls more heavily on the side of the market th